R.I. jobless rate continues slow decline, dropping to 8.2% in May

Friday

Jun 20, 2014 at 12:01 AM

PROVIDENCE — Rhode Island’s unemployment rate continued its slow decline in May with a drop to 8.2 percent, down a tenth of a percentage point from April, according to data released Thursday by the state...

Alex Kuffner Journal Staff Writer kuffneralex

PROVIDENCE — Rhode Island’s unemployment rate continued its slow decline in May with a drop to 8.2 percent, down a tenth of a percentage point from April, according to data released Thursday by the state Department of Labor and Training.

Not only did the rate fall for the sixth consecutive month and reach its lowest point since August 2008, but the number of unemployed Rhode Islanders fell by 600 to 45,600. Meanwhile, the size of the labor force increased by 2,000 to 557,800 and the number of employed residents went up by 2,700 to 512,200.

In the first five months of the year, the jobless rate dropped 1.1 percentage points, compared with 0.8 points for all of 2013. The rate is high — consistently the highest in the nation in recent months — but it is moving in the right direction, said DLT Director Charles J. Fogarty.

“The trend has been very positive,” he said in an interview. “This is another solid month in what is shaping up to be a good year for Rhode Island’s economy.”

Still, Rhode Island’s jobless rate is significantly higher than the national rate, which remained unchanged from April to May at 6.3 percent. Whether Rhode Island still has the highest rate among all 50 states could not be determined on Thursday because the U.S. Bureau of Labor Statistics does not release its jobs data until Friday.

But Rhode Island still lagged its neighbors in May. The rate in Connecticut held steady for the month at 6.9 percent, while the rate in Massachusetts dropped from 6 percent in April to 5.6 percent in May, its lowest point since June 2008.

Fogarty pointed to recent gains in the number of jobs in Rhode Island as a sign that the state’s economy is slowly recovering from the Great Recession. The state has gained 6,400 jobs so far this year, more than the total of 5,400 for all of 2013 and the highest number for a single year since 2000. It is also the highest total for the first five months of the year since 1992.

Sectors that saw large increases include professional and business services, accommodation and food services, and manufacturing, which for so long was a pillar of the Rhode Island economy but has suffered in recent years.

Another area that may finally be showing signs of life is construction. Although the sector saw an increase of only 100 jobs from April to May, the year-to-date gains have totaled 1,300 jobs, according to Donna A. Murray, the DLT’s assistant director for labor market information.

With projects on the former Route 195 land in Providence coming up and construction set to begin on a new chemistry center at the University of Rhode Island, growth is expected to continue.

“The industry is still not where it was before, but it’s moving in a positive direction,” Fogarty said.

Leonard Lardaro, professor of economics at the University of Rhode Island, said the state economy is showing improvement, but the gains are relatively small and coming too slowly.

“We’re in the first inning of a nine-inning game,” he said. “We have a long way to go.”

The problem is that Rhode Island entered the recession before most other states and experienced the economic downturn more deeply. The state’s jobless rate reached a peak of 11.9 percent in the winter of 2009-2010, nearly two full percentage points higher than the peak rate for the nation.

So even now, as the state’s economy improves, it still trails much of the rest of the country.

Lardaro said the question is whether elected leaders will be satisfied with just improving on where Rhode Island was or whether they will implement policies to help the state compete in the future.

“We let ourselves fall this far and we can dig ourselves out of it,” he said.

The state is working to make changes, said Fogarty. They include a renewed emphasis on much-needed work-force training.

“You’re seeing the focus on the fundamentals begin to pay off,” Fogarty said.